There are three most common ways a purchaser can take title in a property: Tenancy in Common, Joint Tenancy with Full Rights of Survivorship, and Tenancy by Entirety.
A Tenancy in Common can occur between two or more persons or legal entities and ownership can be divided into any number of interests, equal or unequal.
- In this type of tenancy, each co-tenant has a separate title to their interest. Upon a co-tenant’s death, his/her interest passes by will to their devisees or if no will, then to their heirs. There are no survivorship rights. This tenancy is the default tenancy and occurs when two unmarried individuals take title and no other tenancy is specified.
A Joint Tenancy with Full Rights of Survivorship occurs between two or more persons and must be expressly stated in order to create.
- Each joint tenant holds a joint life estate and contains a right of survivorship. This means that upon the joint tenant’s death, the decedent’s interest automatically passes to the surviving joint tenant.
To have a Tenancy by Entirety, the parties must be legally married when title to the property is acquired. Here, there is only one title to the whole property, as both spouses are deemed to have a single undivided interest.
- Upon a spouse’s death, the surviving spouse becomes the sole owner of the property, i.e. there is a right of survivorship.
It is extremely important that purchasers review the types of tenancy and decide what fits them the best.
***it is also important that the purchasers indicate on the purchase agreement how they want to take title so that the deed is prepared correctly and efficiently.
It is encouraged that the purchasers consult with an attorney should they have questions about which tenancy is best for them and their estate planning questions.